The CEO called it a watershed moment.
The administrator called it the last piece of the jigsaw.
It is the Coast’s Financial Strategy which the Council-under-administration adopted at the august 23 meeting.
The strategy is basically a list of 13 metrics which, if kept to, are meant to keep Council on track financially.
Of those 13 metrics, five will be reported to the Council-under-administration monthly, with the rest reporting quarterly or yearly.
Administrator Rik Hart said the strategy was the last piece of the jigsaw and “we” need to keep an eye on those five key metrics on a monthly basis.
If any of them turn red, questions need to be asked immediately, he said.
Mr Hart said the strategy effectively “brings to a close the term ‘the financial crisis”’.
“We have moved a long way in 20 months,” Mr Hart said.
“It is Important to get that message out.”
It is a message he has been trying to get for some time.
Draft statements tabled a month earlier, at the July meeting, showed the council to be in surplus for the last financial year (2021-2022) by about $46M.
This is a turnaround from losses of $89M and 71M in the previous two financial years.
Both Mr Hart and CEO David Farmer said the debt from the emergency loan of 150M in December 2020 was already down to about 135M and if the cash position holds into the future, the council might be able to repay that debt earlier rather than later.
Mr Farmer said it was a watershed moment from dealing with the financial crisis to moving into recovery mode with the Council adopting the set of rules around the long term financial plan.
He said Council’s General Fund turns over about $450M a year and at the moment it was holding about $55M worth of unrestricted funds which will become available for use.
Lack of attention to key financial indicators in the past were mentioned at the public inquiry, Mr Farmer said, but now Council will have a set of guidelines to keep things on track.
In some of the 13 metrics, Council will meet the OLG benchmark while in other cases it will better it, according to the strategy.
The five metrics we have to watch monthly are:
# Expenditure v revenue ratio
# Unrestricted Cash reserves
# Loan principal repayments
# Asset renewal
If you want to know what the metrics are (and you’re prepared for a long and boring list) follow this link: